Loan Application Defects Stagnant in 2017
Loan application defects brought on serious concerns for lenders in early 2017. However, the tides are beginning to turn as the final months of the year showed stagnant defects, providing more stability and lower risk.
"As 2017 ends and we look forward to 2018, there is reason to be optimistic about defect, fraud and misrepresentation risk," Mark Fleming, First American's chief economist, said in a press release, according to National Mortgage News.
"Keep in mind that the Loan Application Defect Index was at its lowest point ever in November 2016, before defect risk surged by 24% in the following seven months, one of the fastest changes the defect index has recorded since its inception in 2011."
Lower risks brings more confidence from lenders looking to increase their transactions in 2018. According to the report, the increase from 2016 and onward was heavily influenced by an "increase in the share of purchase mortgage transactions in riskier markets."
To learn more about the now positive numbers for mortgage applications, click on the image above.